Olszewski: Lawsuit claims ‘blatant attack’

Former Luzerne County judge Peter Paul Olszewski Jr. says claims made about him in a racketeering lawsuit filed against former area attorney Robert Powell are false and “a blatant attack” on his reputation.

In the lawsuit, Powell’s former business partner suggests a high-profile environmental contamination suit was rigged in Powell’s favor after it was steered to Olszewski by a court administrator who took a bribe.

“The statements made in the lawsuit that refer to me specifically are a malicious attack on my character as a judge,” Olszewski said Thursday in an email.

Olszewski served as Luzerne County district attorney for eight years and county judge for a decade before being voted out of office in November 2009 in the aftermath of federal charges filed against three county judges and various other elected officials.

“The bottom line is, I have never wavered in my commitment to uphold the law, whether it be as a district attorney, a judge or a litigator,” Olszewski said. “To be unjustly called into question in this dispute over money between two former business partners is a blatant attack on my personal and professional reputation.”

Since leaving office, Olszewski has become managing partner in the law firm Scartelli Olszewski, and has handled numerous high-profile criminal defense and medical malpractice cases in Northeastern Pennsylvania. He is often quoted in local media as a trusted legal expert. Recently, he was appointed as a special prosecutor in Lackawanna County to investigate the sale of three Scranton properties at a judicial tax sale in 2012.

Powell, a central figure in the notorious kids-for-cash scandal in Luzerne County, is poised to share up to $200 million his law firm is owed for representing Avoca residents in a national environmental contamination lawsuit that recently was settled for billions of dollars, according to the racketeering lawsuit filed by his former business partner, Allegheny County investment banker Gregory Zappala.

Zappala claims Powell’s role in the corruption scandal cost him and his businesses $285 million in damages. He is asking a federal judge to freeze any payments to Powell until the lawsuit plays out.

The suit claims Powell, who now lives in Florida after an 18-month federal prison stint, already obtained and spent $3 million in settlement cash. The suit claims Powell uses an alias of Robert Kulbacki and says he has been taking duffle bags full of cash to Costa Rica and frequently visiting Switzerland.

In his motion for an injunction, Zappala claims Powell illegally funded the environmental suit with money from their joint investment in two for-profit juvenile detention centers at the heart of the kids-for-cash case. Powell represented a group of Avoca residents in a suit against Kerr-McGee Corp., which once had a wood-treatment plant in Avoca that used creosote, a distilled coal tar. Nationally, the case recently settled for $5.15 billion.

Zappala is seeking an injunction to block the potential $200 million that Powell’s law firm is due in attorney fees.

Zappala also claims Powell “stole” millions from their companies to bribe judges and “corruptly influence the Luzerne County Court of Common Pleas.”

He claims Olszewski accepted favors from Powell, including a private jet ride and a stay at a Florida condominium central to the kids-for-cash case, but didn’t reveal those facts when presiding over Powell’s toxic waste case. Olszewski denied a motion for summary judgment by the defendants and confirmed arbitration awards in favor of some of the plaintiffs, the suit claims.

Olszewski is not named as a defendant and the suit doesn’t indicate that he played any role in being assigned the case. The suit claims Powell bribed the then-court administrator to assign the case to Olszewski.

In his email, Olszewski said he only presided over early proceedings in the case and his rulings have never been questioned.

“The rulings, made prior to the parties’ mutual decision to seek arbitration in another forum and eventually settle the matter, have never been questioned or appealed, despite being reviewed by the multitude of attorneys who defended the case,” Olszewski wrote.

Before Olszewski was voted out of office in 2009, a federal grand jury subpoenaed records of civil cases he handled between Jan. 1, 2002, and Jan. 31, 2008, that produced damages in excess of $100,000, Times-Shamrock newspapers previously reported. It is unknown whether the Powell environmental case was among the cases reviewed by federal authorities.

Federal authorities, who filed corruption charges against three other Luzerne County judges, never accused Olszewski of any wrongdoing after obtaining the records.

The U.S. Attorney’s Office declined to comment Thursday about the allegations of judge-shopping included in the racketeering lawsuit against Powell.

The Powell-Zappala partnership began in 2002 when they built their first juvenile detention center, Pennsylvania Child Care, in Pittston Township. They later built a second center in Butler County called Western PA Child Care. Zappala, son of a former state Supreme Court chief justice and brother of the Allegheny County district attorney, abruptly ended his partnership with Powell in June 2008 after Times-Shamrock reported the FBI was investigating financial ties between Powell and two Luzerne County judges.

The judges, Mark A. Ciavarella Jr. and Michael T. Conahan, were eventually charged in January 2009 with taking $770,000 in kickbacks from Powell and failing to report $2.1 million in finder’s fees paid by the developer, whose construction company built the facilities. Ciavarella is serving 28 years in federal prison, while Conahan is jailed for 17½ years.

Powell served 18 months in prison after he pleaded guilty to failing to report a felony and being an accessory to tax conspiracy.

Zappala was never accused of any wrongdoing and has maintained he was kept in the dark regarding Powell’s illegal acts.

Olszewski lost his retention election in November 2009 after a photo was published by Times-Shamrock that showed him partying at the Florida condo with Conahan and a convicted drug dealer during a 2005 trip.

Prior to the election, Olszewski maintained his travel arrangements to Florida were arranged by Conahan, long before Conahan was suspected of any wrongdoing. At the time, Olszewski said he reimbursed Conahan for the trip by writing him a $400 check. Olszewski said he did not encounter Powell during the trip.

While allegations of judge-shopping long dogged the county court system, that type of conduct is no longer possible in Luzerne County due to new assignment system put into place in May 2009, months after Ciavarella and Conahan were charged.

“What we do now, we have a computerized system of randomizing, which results in civil cases being blindly assigned to judges,” said Court Administrator Michael Shucosky, who took over in 2011. “It’s not possible for an individual judge to cherry pick a case or for a court administrator to unfairly burden a judge with a case or transfer a case to a particular judge.”

bkalinowski@citizensvoice.com

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